October 11, 2011 > Additional community banks receive funding for small businesses and job creation

Additional community banks receive funding for small businesses and job creation

Submitted By U.S. Department of the Treasury

The U.S. Department of the Treasury announced on September 28, 2011, that 16 additional California community banks received a total of $103.1M as part of the final wave of funding provided through the Small Business Lending Fund (SBLF). The SBLF, established as part of the Small Business Jobs Act signed into law by President Obama, encourages community banks to increase their lending to small businesses, helping those companies expand their operations and create new jobs. A total of 30 California community banks have received an aggregate SBLF funding of $274.5M.

"Billions of dollars in SBLF funds are being put to use in communities across the nation, spurring small business growth and job creation," said Deputy Secretary of the Treasury Neal S. Wolin. "These investments, which will help propel lending by Main Street banks, are good for our economy and good for America's small businesses."

Small businesses play a critical role in the U.S. economy and are central to growth and job creation. Small businesses employ approximately half of all Americans and account for about 60 percent of gross job creation. However, small business owners faced disproportionate challenges in the aftermath of the recession and credit crisis, including difficulty accessing capital.

The SBLF helps small businesses meet this challenge by providing capital to community banks that hold less than $10 billion in assets. The dividend rate a community bank pays on SBLF funding is reduced as that bank increases its lending to small businesses - providing a strong incentive for new lending to small businesses so they can expand and create jobs.

The SBLF is one part of the Obama Administration's comprehensive agenda to help small businesses access the capital they need to invest and hire. The State Small Business Credit Initiative (SSBCI), which is also a key part of the Small Business Jobs Act, allocates $1.5 billion to new and existing state programs that will leverage private financing to spur $15 billion in new lending to small businesses and small manufacturers.

The Obama Administration has also supported 17 direct tax breaks that provide tax relief of more than $50 billion for small businesses. These tax breaks were designed to support job creation and retention, entrepreneurship, investment and growth. The Administration has also worked with Congress to extend and expand existing Small Business Administration loan programs that helped put more than $42 billion in the hands of small businesses and deliver other important benefits to help small businesses expand and hire.

For more information about the SBLF program, visit http://tinyurl.com/2d4oj8y